Tech Company assembles laptop computers from generic components. It purchases its colour monitors from a manufacturer in Taiwan with a lead time of one week. Daily demand for monitors is normally distributed with a mean of 30 monitors and a standard deviation of 8 monitors. The company has determined that the ordering cost is OMR 125 per order, the annual holding cost is OMR 25 per monitor, and the stockout cost is OMR 160 per lost sale. Currently, this company accepts a 5% risk of stockout. Assume 350 days per year and 7 days in a week.

a) This company applies a continuous review system. What is their reorder point?

b) What is the cost of the safety stock?

c) With the current 95% service level, how many stockouts are expected each year?

d) Calculate the current fill rate.

e) What is the annual cost of lost sales?